The GLA overall asking lease rate increased to $3.25 per sq. ft. per month in Q4 2017 from $2.94 per sq. ft. per month in Q4 2016. New and renovated product in many areas pushed lease asking rates higher on an annual basis despite a significant amount of supply in the region.
Although several large deals were signed during Q4 2017, activity levels in 2017 represented a deceleration of activity compared with the past few years of the current economic expansion. At the close of 2017, Greater Los Angeles’ 349,343 sq. ft. of position net absorption was due in part to a strong Q4 2017.
There were 1.9 million sq. ft. of office space under construction in GLA. No projects were delivered in Q4 2017, although several West LA are set for completion in early 2018.
For the first time in more than a decade, a GLA submarket other than West LA had the highest annual office sales volume. Tri- Cities sales totaled $3.66 billion in 2017, which edged out the $2.81 billion in West LA Investors were attracted to core assets in core locations and to value-add assets in areas that feature a live-work-play environment.